Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT RATES :: articles on VAT and GST in India :: empanelment :: due date for vat payment :: ACCOUNTING STANDARD :: VAT Audit :: ARTICLES ON INPUT TAX CREDIT IN VAT :: TAX RATES - GOODS TAXABLE @ 4% :: cpt :: Central Excise rule to resale the machines to a new company :: list of goods taxed at 4% :: form 3cd :: ACCOUNTING STANDARDS :: TDS
 
 
« News Headlines »
  9 changes that came into effect from April 1
 First time filing income tax? Here's all you need to know about Form 16 and Form 26AS
 New Opening Financial Controller Chartered Accountant (Manufacturing Plant) A Leading Company
 Income Tax Filing 2017: All you want to know about the single page ITR form SAHAJ
 How to benefit from investments in tax saving mutual funds
 60 per cent of income tax notices on fishy cash deposits returned
 All about income tax return form Sahaj
 Why seeing Form 26AS is a must before filing tax return and how to access it
 No tax on notice period pay cut
 Interpretation Of Central Goods And Services Tax (Cgst) Act (Part-1)
 What to do if you haven’t filed your taxes

Dual service tax regime for legal fraternity
March, 07th 2016

Budget 2016 has created confusion in the ranks of the legal fraternity by proposing a dual service tax regime. Senior advocates would now be liable to discharge service tax on forward charge basis. That means, when presenting their bill to a client, senior advocates would add the component of service tax on the value of services. In contrast, the rest of the industry - namely other advocates and law firms - would continue to discharge service tax under the reverse charge mechanism. Under this, the recipient of the service - the client - is liable to bear the tax.

Under forward charge mechanism, senior advocates would be able to claim offset credit for service tax. "This will not be available to law firms," says Sujit Ghosh, partner & national head, Advaita Legal. "The need to enjoy offset credit is much more for law firms given their high establishment costs," adds Ghosh.

The legality of the levy of service tax on legal services is yet to be decided, and the matter is still sub-judice. There has been a spate of litigation since 2011 when the Finance Act sought to expand the scope of the 'legal consultancy service'. Several Bar councils, including the Society of Indian Law Firms, have challenged the levy of service tax on legal services. Legal consultancy service was brought under the ambit of service tax in 2009.

Taxing advocacy:
The story so far

Finance Act, 2009

Introduced the levy of service tax as 'legal consultancy service'
Appearances before any court, tribunal or authority kept outside the ambit
Finance Act, 2011

The scope of 'legal consultancy service' amended to include services provided to any business entity, by any person
Withdrew exemptions given to appearances before any court, tribunal or authority
This became the subject matter of litigation before various high courts in the country. The legality of the levy is still sub judice
In 2012 under a new service tax regime, the recipient of the legal service - the client - was made liable to bear the tax under the reverse charge mechanism
Finance Act, 2016

Proposes to create a dual service tax regime
Senior advocates are now liable to discharge service tax obligations
Law firms and other advocates continue to discharge service tax liability under reverse charge mechanism, whereby the clients pay the tax to the government

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Achievements

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions